In the past 3 months, online education companies have experienced 5 shorts from 3 shorts. Among them, the well-known short-selling agency Citron has continuously released three short-selling reports, one of which describes who to learn from as “the most blatant Chinese stock fraud since 2011.”
Who to learn from may be one of the most intensive Chinese stocks in recent years.
The last intensive short sale of a single Chinese stock was also Citron’s handwriting-from November 2011 to March of the following year, Citron released a total of 6 short reports for Qihoo 360, indicating that its share price was Serious overestimation, fraudulent income data, founder Zhou Hongyi has historical financial problems and so on. In response to the continuous short sale, Qihoo 360 held a telephone conference to respond one by one, and announced the audited financial report, which finally carried the “hunt” of Citron.
After six shorts, Zhou Hongyi accepted Interview with “Entrepreneur” magazine said, “The most fundamental thing when dealing with short selling is to be clean and have no problems. Second is your performance. In the end everyone still looks at performance , It ’s useless for you to explain the smallpox. “
On May 6, who learned to release the 2020 Q1 financial report, this repeatedly short-selling Chinese stock still maintained high growth: net income of 1.298 billion yuan, an increase of 382% year-on-year, under non-US accounting standards Net profit was 191 million yuan, a year-on-year increase of 406%. The next day, Citron released the third part of the report on who to learn to sell short, saying that after studying more than 80 WeChat public accounts, it was found that who to learn to use multiple affiliated companies to transfer costs, making the company’s customer acquisition cost much lower For similar companies.
Screenshot of Citron Short Report
Who to learn fromIn response, the WeChat public account listed in the short report is the partner with whom to learn to market and promote, and all related party transactions with who to learn from have been fully disclosed in the financial report. Founder Chen Xiangdong said on social media that the “so-called” real hammer “in the Citron report is really terrible.”
As of May 8 when the US stocks closed, the stock price of who to learn from was $ 41.98, and the total market value reached $ 10.022 billion. Compared to when the company was shorted for the first time this year (February 25), its share price fell by 9.13%. But overall, it is still at a high stock price, and it is a very expensive education stock-after all, the opening price of the first day of listing is only 12.1 US dollars. After 11 months, the stock price has doubled 2.5 times.
Go short 5 times because “it is too good to believe”
Let ’s first briefly sort out who I learned from the whole process of being short in the past two months-
(1) On February 25, 2020, Grizzly Research released a short report, who believed that it was suspected of overstating financial data (74.6% profit exaggeration in 2018), brushing bills, and forging financial figures through related parties. 2. Transfer funds by buying a house in Zhengzhou;
(2) On April 14th, Citron released its first short report, claiming that up to 70% of its revenue was fictitious, and believed that it should be suspended for investigation;
(3) On April 30, Citron released the second part of the shorting report, which provided recordings from whom to learn to hire employees of the billing company, mainly questioning who to learn from and fabricated 40% of the number of users in FY2019;
(4) On May 6, the investment agency Scorpio VC released a report saying that the stock price with whom to learn is seriously overestimated, and the actual value is estimated to be only 4 ~ 6 US dollars. The main question point is that Zhengzhou buys Building, salaries of famous teachers, course quality, etc.;
(5) On May 7, Citron released the third part of the short report, questioning who to learn to use multiple affiliates to reduce the cost of acquiring customers.
In fact, from the stock price trend from the end of February to the beginning of April, it can be seen that the short sale initiated by the Grizzlies in February did not have much impact on the stock price with whom to learn. The Xiong report is full of subjective assumptions and logical confusion, so “no evaluation is needed.”
However, after Ruixing disclosed that it had made financial frauds, the Chinese stock market was questioned as a whole, and the share price of who learned from it fell by 25% within 8 working days.